OpenAI, maker of ChatGPT and other artificial intelligence tools, has officially shifted to a for-profit model and will incorporate as a public benefit corporation. That long-sought change means the company will no longer be controlled by a nonprofit board, and paves the way for more investment and a potential IPO.

OpenAI was founded in 2015 as a nonprofit research lab focused on ensuring AI would benefit all of humanity. In the last three years or so, it’s ballooned into an artificial intelligence goliath valued at $500 billion.

“Which makes it one of the largest tech companies and rivals some of the biggest publicly traded firms today,” said Sarah Kreps, who directs Cornell’s Tech Policy Institute.

Restructuring will help OpenAI attract investors and compete with tech giants like Alphabet, Amazon, and Meta, she said. But as a public benefit corporation, OpenAI says it will balance those goals with the public interest.

“If you’re OpenAI, you want to sort of persuade regulators and the public that you’re the good guys,” said Jens Christian Dammann at UT Austin’s School of Law. “Forming a public benefit corporation can be a smart public relations move.”

In practice, however, Christian Dammann noted that PBCs aren’t always held to their promises.

And critics like Robert Weissman with the advocacy group Public Citizen said this shift means even fewer guardrails on the rapidly growing AI sector.

“It’s locking down a problematic status quo,” where he says profit motives trump the risks of bringing new AI tools to market.